Interesting historical analysis from Chart of the Day: To answer the question "How does the current stock market rally rank?" they plotted all major market rallies of the last 105 years by duration and percentage gain.
The results are below. Each dot represents a major stock market rally as measured by the Dow:
click for larger chart
COTD: Over the past century, the Dow has begun a major rally 26 times or once
every four years. Second, most major rallies (76%) resulted in a gain
of between 30% and 150% while lasting between 272 and 913 trading days
(1.1 to 3.6 years). As it stands right now (with the Dow up 50% as of
its most recent rally high on March 4th, 2005), the current Dow rally
would be classified as moderate.
- The Dow Jones Industrial Average was not adjusted for inflation or dividends.
- There are 252 trading days in a year (100 trading days equal about 4.8 calendar months).
- The starting year for the biggest five rallies have been labeled for your convenience.
- A major stock market rally has been defined as a 30% or greater increase in the Dow (following a correction of 15% or more).
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